EU price update from HOG, JV Innovation Ford-SK and more


Last week, the European Automobile Manufacturers Association (“ACEA”) released data on passenger car registrations made in April 2021. New car registrations soared 218.6% year on year to 862 226 units. With the exception of Spain, Italy and Ireland which saw four-digit percentage increases, all other regions saw double- and triple-digit percentage gains in car sales. particulars in the past month. Registrations in major markets such as Spain, Germany, France and Italy increased by 1,787.9%, 90%, 568.8% and 3,276.8% respectively. The rise was the result of the collapse in demand induced by COVID during the period of the previous year. Nonetheless, the coronavirus concerns are far from over as last month’s sales were nearly 300,000 units below April 2019 levels.

Meanwhile, the disruption caused in the auto market due to the global chip shortage does not appear to be easing. Amid the semiconductor shortage, the U.S. auto giant Ford F announced that it would suspend production at eight North American factories for various periods until June. Popular models such as the Ford Mustang, the Escape, the F-150 pickup and the Bronco Sport SUV will be affected. Ford currently wears a Zacks # 3 (Hold) rank. You can see The full list of current Zacks # 1 Rank (Strong Buy) stocks here.

Top Stories from last week

Harley davidson HOG grabbed the headlines after issuing a statement updating European Union (EU) tariffs on its motorcycles. To Harley-Davidson’s relief, the EU suspended the planned retaliatory tariff hike at 56% for up to six months, as part of a trade truce with the United States. As a result, motorcycles from the Milwaukee-based motorcycle maker are now subject to a 25% retaliation duty, bringing the overall duty on its bicycles imported into the EU to 31%. For Harley-Davidson, Europe is its second market after the United States, which will help guide the company’s turnaround strategy. Harley-Davidson wholeheartedly embraced the truce because it would prevent tariff escalation on its motorcycles. (Harley-Davidson breathes a sigh of relief over EU trade truce)

Toyota TM selected German Tier 1 supplier ZF and Mobileye for the development of advanced driver assistance systems to meet global safety regulations for use in future Toyota vehicles. As part of this collaboration, ZF and Mobileye will work together to produce advanced camera technology integrated with ZF radar technology to power Toyota’s advanced driver assistance platforms. Mobileye’s EyeQ 4 will be merged with ZF’s mid-range Gen21 radar technology to understand the environment around Toyota vehicles. For Toyota, this deal is a victorious deal as ZF and Mobileye are seen as an unbeatable combination for safety technology. (Toyota names ZF and Mobileye for advanced safety technology)

Copart, Inc. CPRT reported adjusted earnings per share of $ 1.09 for the third quarter of fiscal 2021 (ended April 30, 2021), beating Zacks’ consensus estimate by 80 cents. Net income also jumped 87.9% year-over-year, from 58 cents reported in the previous year’s quarter. Total revenue was $ 733.9 million, beating Zacks’ consensus estimate of $ 637 million. Also, the top line has increased from the figure of $ 550.4 million released a year ago. The leader in online auto auctions had cash and long-term debt of $ 911.9 million and $ 397.6 million, respectively, as of April 30, 2021. (Third Quarter Copart Earnings and Sales Estimates, Y / Y Increase)

Ford recently entered into a memorandum of understanding with South Korea-based SK Innovation to form a joint venture (JV) – referred to as BlueOvalSK – to manufacture battery cells and grid modules in the United States. The new venture will produce around 60 gigawatt hours (GWh) per year from the middle of the decade, subject to regulatory approvals. The joint venture would allow Ford and SK Innovation to collectively mass-produce custom battery cells to deliver effective added value to customers. (Ford Partners SK Innovation, the EV game is gaining traction)

Autoliv ALV has announced plans to build a new steering wheel manufacturing plant in Mexico. Construction of the new facility is expected to begin in June and the plant is expected to become operational by January 2022. The project will increase capacity and help optimize manufacturing processes. It will also improve the company’s digitization and automation strategy, involving advanced manufacturing processes.

Price performance

The following table shows the price development of some of the major automotive players over the past week and six month period.

Over the past six months, all inventories have gone up with Ford being the maximum winner. Last week showed a mixed price trend, with Ford gaining the most and Harley-Davidson recording maximum losses.

What’s next in the auto space?

Industry watchers will be keeping tabs on commercial vehicle registrations for April, which is due to be released by ACEA this week. Investors are awaiting the quarterly results of AutoZone AZO, which is scheduled for release tomorrow. Also beware of updates related to disruption related to chip cracking in the automotive market.

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Ford Motor Company (F): Free Stock Analysis Report

Toyota Motor Corporation (TM): Free Inventory Analysis Report

AutoZone, Inc. (AZO): Free Inventory Analysis Report

Autoliv, Inc. (ALV): Free Inventory Analysis Report

HarleyDavidson, Inc. (HOG): Free Stock Analysis Report

Copart, Inc. (CPRT): Free Stock Analysis Report

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